Basic Generation Service Rates Rise for PSEG Electricity Customers

Residential PSEG electricity customers who are on the basic generation service rate are getting hit with a summer rate increase. The basic generation service rate is the price for electricity power supply that customers pay who have not chosen to buy their power from a competitive supplier. As an energy choice state New Jersey residents have the ability to shop the market for competitive electricity rates the same way they can shop for phone service or television content providers. Customers who do not participate in the market by shopping and buying their power from a competitive supplier pay the basic generation service rate offered by PSEG.

PSEG updates their basic generation service rates twice a year on June 1 and October 1. The PSEG basic generation service rate, which serves as a default electricity price, is determined through three auctions that take place in the previous three years of the current basic generation service rate. Competitive suppliers are often able to offer more favorable pricing than the default price, offering customer an opportunity to pay less money on their PSEG electric bill. The new PSEG basic generation service price will have residential customers paying a maximum of $0.131959 per KWH for customers who consumer above 600 KWh in a month. Meanwhile, competitive New Jersey electricity suppliers are offering fixed rates in the 10 and 11 cent range.

As of April 2017 PSEG has reported that only 12% of their residential customers have switched off of the default basic generation service price and onto a competitive plan. The new summer rate increase for 2017 could provide an incentive for the more than 1.6 million residential customers, currently on the default plan, to shop for the first time. Statewide New Jersey energy choice has resulted in 505,111 residential shoppers and 151,805 commercial and industrial customers. Despite the low residential switch percentage competitive New Jersey suppliers remain optimistic at their chances of acquiring new customers. PSEG customers have more than a dozen electricity companies to purchase their power supply from, many of which are offering fixed rates below the default price. Below are rates offered by suppliers who are licensed by the New Jersey Board of Public Utilities.